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When Banks Mistakenly Withdraw Money From Your Accounts

Saturday, August 24, 2013 - 2:00 PM
I had one credit union which made two unauthorized debits of around $100 to my account. For those cases, the credit union immediately resolved the mistake when I reported it. For the case described in this article, it took Wells Fargo several days to resolve an unauthorized debit of $6,000.

Have you had cases when your bank or credit union mistakenly withdrew money from your account? How long did it take for the bank to give full and permanent credit of the amount?
Ken TuminKen Tumin5,472 posts since
Nov 29, 2009
Rep Points: 125,708
1. Sunday, August 25, 2013 - 9:21 AM
For the life of me, I can't remember that ever happening to me. Perhaps I was lucky in that regard.
ShorebreakShorebreak2,694 posts since
Apr 6, 2010
Rep Points: 14,610
2. Sunday, August 25, 2013 - 4:47 PM
Yes, one credit union (with very high RCA/CD rates) mistakenly withdrew $250 from my RCA.  Luckily I discovered it the next day.  The money was back to my account in no time (within a day).  It was an erroneous ACH debit, with account number mixed up by one digit.  It was a scary experience for me since it was a loaded RCA account and I had no idea what happened or whether there would be continual withdrawals.   

I believe strongly that small banks or credit unions handle such cases much more efficiently than big banks like WF, Citi, or BofA. 
51hh51hh1,476 posts since
Jan 16, 2010
Rep Points: 6,427
3. Sunday, August 25, 2013 - 6:37 PM
Rhett, I can well understand that you would be very worried about the balance in the account after the erroneous ACH debit. 

In thinking through the situation, it sounds like another customer set up an incorrect BillPay or auto debit - did the credit union give you any insight into what happened?  It's too bad the accounts for those BillPays aren't verified as they are when you link an account at one bank to an account at another.  In my mind that's always been a huge gaping hole in the process and I don't understand why prior verification of ownership/access to the account (through for example trial deposits) is not a requirement for a BillPay or an automatic debit. 

I'm sure the experience kept you awake a couple of nights.   Thank goodness you were on top of things, saw the transaction almost immediately and that everything was resolved for you promptly.  
pearlbrownpearlbrown1,485 posts since
Nov 2, 2010
Rep Points: 6,454
4. Sunday, August 25, 2013 - 9:15 PM
20 something years ago, at Ridgewood, in LINY, another person's check was applied against my account.  They included the wrong account's cancelledcheck in the monthly statement, along with my checks.  I brought in the statement, showed them the error (and the wrong cancelled check), and was credited.  I think it was $100.
MikeMike327 posts since
Feb 22, 2010
Rep Points: 876
5. Monday, August 26, 2013 - 6:54 AM
In the early 80's when my youngest son was in college he ran a check from his roommate's parents thought my account each week. I put him on my account and he would deposit that check each week.  I received a note from the bank that an empty envelope had been deposited on campus. I called him immediately and he said he had put the check in the envelope in the night depository as he did every Sat night after his music session. He said it was not windy and he was sure he put the check in the envelope. I told him to have his roommate call his parents in Wisconsin and have them send a copy of both sides of the check to the son and bring it into the branch on campus. What had happened was the check got mixed up with another deposit when they were processing the deposits after the branch had opened. On Monday mornings they had a lot of night deposits to process and they finished them in between other customers and they were processed at the teller windows instead of at a secure place. They did business night bags before the branch opened and if everything did not get finished before they opened it was the envelopes which rarely had cash in them (especially in a branch on a college campus). This policy was changed immediately. The employees came in 15 minutes earlier on Mondays. I worked at that bank but in another city. They were very nice to my son and apologized and gave him a coffee cup with the bank's logo on it I think. I can imagine with a branch near campus that the branch  probably had heard heard a lot of stories from the college kids. 
Ally6770Ally6770941 posts since
Jan 16, 2010
Rep Points: 2,739
6. Monday, August 26, 2013 - 10:58 AM

I recently experienced this situation with Bank of America. Sorry in advance for the the length of this reply. I keep a money market IRA open at BOA. When an IRA CD matures I transfer it to this MM until I locate an IRA CD to my liking. I recently had a disbursement from my profit sharing from my former employer and had it sent to this account at BOA. A couple weeks later there were two IRA cds that I opened at two different banks. Bank A sent a transfer request to BOA to fund the account. A few days later Bank B did the same thing. I funded both accounts with the same amount. I checked online and saw the amount in my BOA account was reduced to reflect these requests so everything good.

About a week later while doing my monthly check I see my account at BOA has been reduced further than what it should be. I can’t view the individual transactions of this account until I receive my quarterly statement so I did not know where the money went. I immediately went down to my local BOA branch for answers. They can’t view the transactions of this account either and contacted their IRA department. They stated that Bank A made a second request. I went home and contacted Bank A and of course they knew nothing of this. I had them e-mail a copy of the authorized transfer request and took it down to BOA and asked them to show me the two transfer requests they received from Bank A. Their IRA department faxed over the two requests while I waited. The second request was a duplicate copy of the first request but they said it arrived on a different date. I could not believe they did not have a check and balance for this situation. Anyway Bank A had to send the check back to me and I had to bring the check to BOA to have it re-deposited.

After this money was refunded along with the $50 transfer fee BOA charges, I was checking online and again I see the amount in the account is off so back to the BOA branch and the IRA department indicated that Bank B made a second request for a withdrawal. Again I told them this was not authorized and this time they agreed to just put a stop payment on the check and put the money back into the account along with the $50 transfer fee.

Not to be out done this situation happened a third time. This time when I went to BOA I told them look you obviously have a problem with your system and are duplicating requests. We know the amount in the account after I made the deposit from my profit sharing so lets start there. I authorized one transaction to bank A and one to bank B. Deduct these amounts plus the $50 transaction fee for each transaction and that is the amount that should be in my account plus a little bit of interest. I know I lost some interest while these funds were out of my account but after dealing with this for three to four weeks, I was just happy to get it settled.

I was going to post this situation but then Ken made his post about unauthorized withdrawals.

My question, would be what if BOA did not agree to make this right and insisted bank A and bank B made a second and third transfer request. For future reference is there a banking authority that would look into a dispute between two banks?
FARFAR108 posts since
Feb 26, 2013
Rep Points: 387